The Palatka daily news. (Palatka, Fla.) 1884-1888, 1887-04-03

THE ASSOCIATION ITSELF.

AT three clGk tfhS dtcrfiooH. q
hearing was given to the representatives
of the Southern Railway and Steamship
Association. They We're fifteen or twenty
in number. Milton ii. Smith, Vice-Pres-
ident of the Louisville and Nashville
Railroad, was selected as the spokesman
of the delegation and addressed the Com
mission. He said they were present to
apply for authority to charge less for the
transportation of property between COM
petitive points by the lines of the MEM
bers of the Association than between in
termediate points He said that the As
sociation was only one of several which
had come into existence through the de-
velopment of transportation during the
last twenty years
At first little effort was made by the
Railroad lines for cooperation. Ship
pers were in the habit of shipping to
forwarding houses when their shipments
passed beyond the terminus of the first
road. Out of this condition grew the
fast freight lines. formed by fOrwarders
who by making special arrangements
were able to secure rates below those
which shippers would he compelled to
paw the roads if they dealt individually.
Then the roads began the through traffic
system, and frequent conferences be
tween the agents of the various lines
became necessary, which conferences
finally resulted in associations, of which
the Southern Railroad and Steamship
Association. was one. He read the ar
ticles of the Association. Commissioners
Walker asked if the Association was in
the nature of pool.
Mr. Smith replied tlat everything in
the nature of an allotment of traffic, or
dinarily called a pooling arrangement.
had been eliminated. Very little author
ity, he continued. was delegated to the
Association. The organization depended
upon voluntary compliance with the ar
rangement agreed upon There was no
way to enforce compliance. MIR. Smith
produced a map of the territory covered
by the Association and pointed out the
water lines which surrounded and pene-
trated it. Many of the lines of trans
portation upon these waters, he said,
were not subject to the Interstate Com
merce law, though nearly all of them
were engaged i'm Interstate traf-
fic. The first of the railroads were
built to connect particular points with
water. Their rates were in all Gases
greater for long than for short hauls- Ii
was found that for short distances ami
NAL transportation was cheaper than
rail traffic. but for distances of twenty
five miles or more rail transportation at
profitable rates was the cheapest.
WHEN DETERMINATIONS BEGAN.
When, after a time. the great agricul-
| tural centers We're reached, it was found
| that upon some materials of large bulk
| the established rates We're such that no
shipments could be profitably made. This
| discovery gave the railroad people their
| first lesson in the art of promoting
transportation" When different lines
were completed To points where they
came into competition with each other
and with water lines, railroad managers
| first awoke to the fact that they could
| compete with water lines, which they
had never before expected to do, and
here first was presented the question of
accepting less for the lo ~ than the short
haul. The discovery was made which
was, and is, seemingly a paradox. 1t
| was that traffic could be transported
and yield a profit mt a rate that is less
than the average cost; that the additional
/ ff..s .H at n rat that yIpl,iS
enue in excess of the additional cost of
the carriage, though less than the aver
age cost, produces profit.
| ARGUING THE CASE.
Mr. smith contendei that the rates
fixed by the Louisville and Nashville
Company are not in violation of the act
OF Congress. Ii prohibited from carrying
less for longer distance than for i
shorter. where the conditions are sub
stantially similar. then. he argued. they
were authorized to charge less for i
longer than for shorter distance where
the conditions are substantially dissimi-
lar, provided the rates To and from non
competitive points are just and reason
able. Some of his associates, represent
ing other large corporations, did not agree
with him. but held that under no condi-
tion could any greater charge be made
for short than for n longer haul unless
authorized by this Commission.
ALL TRAFFIC. ARRANGEMENTS ABOLISHED
Mr.. Smith said his company had re-
ceived notices from all the great hne>
of the North that from and after the 5tl
inst. all existing traffic arrangements
must cease. This was due. he explained
to the difference in Interpretation of thu
Interstate Commerce law. These
roads based their action upon the refusa
of the Louisville X Nashville to- reduce
its local rates below its through rates
holding that they would be liable AZ
participants in any penalties incurre,
by the former. Mr.. Smith set forth, a
considerable length. the circumstance
which led the Northern trunk lines Il
make such construction of the law
They were not subject Ia such an eNten
to water competition ON and their interpre
tation was the only one that was advan
tayeous to them. They would appea
before the Commission and advocat
an interpretation which would henefi
them but bankrupt us.
Mr.. smith did not believe there wa
any reason for the present agitation
Surely carriers We're not to be- punishe'
for the, violation of a law which the
could not understand. Ii was clear nov
that the Commission should have bee
> organized and should have heard thes
, questions and decided them earlier.